Big-five Personality Traits and Pro-environmental Investment Specifics from an Emerging Economy

Abstract

Investment in pro-environmental financial assets like ‘green shares’ is rapidly emerging field in the area of personal finance. However, there has been a dearth of studies that could possibly explain the factors that indulge an investor to invest in ‘green shares’, in the context of a growing economy like India. Therefore, the present study makes an attempt to analyse the possible role of personality trait of an individual investor, keeping in mind his concern towards the environment, on his investment decision in ‘green shares’. This study has incorporated the Big-Five personality traits, along with the measures that determines an individual’s affection towards his environment and its relationship with his decision to invest in environmental friendly companies. A total of 572 individual investors participated in the study by completing a questionnaires about their personality, environmental concern and investment decision through disproportionate stratified random sampling. The collected data was analysed using Structural Equation Modelling (SEM). The results of the present study revealed that individuals largely differ in critical ways in terms of their personality traits, which in turn plays a very detrimental role towards deciding the investment decision in ‘green shares’.